What Made Egg Prices Soar Nearly 42%?

Prices that U.S. companies pay for fresh eggs took flight last month, buoyed by an avian flu outbreak in Mexico.

Bloomberg News

The producer price index for fresh eggs soared almost 42%, the biggest gain on record, driving broader inflation for food products, the Labor Department said Friday.

A leading reason for the crack up: U.S. farmers are exporting more eggs to Mexico, eating into supplies for American consumers. The United States’ southern neighbor has been hit by avian influenza, forcing the slaughter of thousands of chickens.

Fresh egg exports to Mexico for the first four months of 2013 totaled 12.9 million dozen, up sharply from 478,539 dozen for the same period in 2012, the U.S. Department of Agriculture reported earlier this month.

“We have been shipping a lot of eggs to Mexico,” said Dave Harvey, an economist at the USDA.

Fresh-egg prices tend to be volatile. Unlike meats or poultry, eggs can’t be frozen. A chicken lays an egg and it has to be moved to market quickly. That leads to big seasonal price swings when supplies fall or demand rises — for example, around Easter.

Mr. Harvey said the price surge probably won’t last. The USDA expects Mexico’s egg production to stabilize as the country repopulates its flocks.

Prices have already started to come down from May. In the Northeast, wholesale prices for large eggs were about 87 cents to 91 cents a dozen earlier this month, compared with a high range of $1.25 to $1.29 earlier in May, according to the USDA.

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